Sino Global Capital Files $67 Million FTX Claim

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  • Sino Global Capital has filed a $67 million claim against FTX due to losses from the near-collapse of their Liquid Value Fund I
  • The fund’s investments, including tokens like SOL, SRM, MAPS, OXY, and JET, suffered significant price drops during FTX’s financial difficulties
  • Former FTX CEO Sam Bankman-Fried’s indirect involvement in the fund was documented, and Sino Global’s losses led to the formal claim against FTX.

Crypto venture firm Sino Global Capital has filed a $67 million with FTX, saying it is owed the money following the near collapse of a fund it launched with Sam Bankman-Fried. The Liquid Value Fund I, targeted at institutional investors only, sought to raise $200 million in 2021 with FTX in place as a partner. When FTX collapsed in November last year, Sino Global said that its exposure was “confined to the mid-seven figures,” but clearly the losses accrued have led it to make a formal claim to repayment from FTX. 

Sino Global Endured Massive Price Drops

Sino Global’s investments were known to include tokens such as SOL, SRM, MAPS, OXY, and JET, which all suffered significant price drops when FTX encountered financial difficulties last year. Concerns arose about potential token liquidation, given limited liquidity and the risk of further value erosion.

Former FTX CEO Sam Bankman-Fried was indirectly involved as an investor in the Liquid Value I fund’s general partner through his trading firm Alameda Research and an entity called Alameda Ventures. This information was documented in a filing with the U.S. Securities and Exchange Commission (SEC) in February.

When FTX collapsed last year, Sino Global was publicly calm about the link and the potential losses in Liquid Value I, according to a tweet it sent out after FTX filed for bankruptcy:

At this point, it isn’t known whether the purported loss relates to the fund itself or other indirect exposure, with the company’s portfolio outside of Liquid Value I known to have been $129 million at the time of FTX’s bankruptcy.

However, Sino Global’s tweet was at the bottom of the bear market, since when prices have risen dramatically, suggesting that they could have recouped much of their paper losses.